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      Question

      The amount payable on maturity of a certain sum which is

      invested for 5 years at a certain rate percent p. a. is โ‚น9,600 and the amount payable on the same sum invested for 10 years at the same rate is โ‚น12,600. If simple interest is offered in both cases, the rate of interest p. a. is:
      A 9(1/11)% Correct Answer Incorrect Answer
      B 8% Correct Answer Incorrect Answer
      C 11(1/9)% Correct Answer Incorrect Answer
      D 11% Correct Answer Incorrect Answer

      Solution

      Simple Interest, SI = (P ร— R ร— T) / 100 For the 10-year investment plan, Rs. 9600 would be considered as the principal amount. Since the interest being calculated is simple interest, the interest incurred in 5 years- ย  = (12600 - 9600) =Rs. 3000 Hence, interest incurred every year = 3000 / 5 = Rs. 600 Now considering the 5-year investment plan, the principal amount = (9600 - 3000) = Rs. 6600 Let the rate of interest be R%. โ‡’ R = (600 ร— 100) /6600 R = 100/11% โˆด The rate of interest is 9(1/11)% p.a.

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